Sony April-December loss shrinks 75%

Japanese electronics giant Sony said on Thursday that its net loss from April to December shrank 75 percent on-year and added that it remains on track to achieve its forecast of a full-year profit.

The results, released after reports that Sony will this month announce the late 2013 launch of its latest PlayStation games console, also showed the firm returned to profitability on the operating side from a year earlier.

Sales rose 3.6 percent to 5.07 trillion yen ($54.17 billion) thanks to strong demand in the mobile products and movies division, offsetting falling sales of liquid crystal display televisions and in the videogames unit, the company said.

Sony also pointed to the weakening of the yen in recent months as a boost for its balance sheet.

The unit has been a huge headache for Japanese manufacturers as it soared to a record high around 75 on the dollar in late 2011, making their products less competitive overseas and shrinking the yen value of overseas income.

But the currency has fallen steeply in recent months, with the dollar buying 93.58 yen in Asian forex trading Thursday.

Sony's results saw it book a loss off 50.87 billion yen in the nine months to December, well down from a 201.45 billion yen loss in the same period a year earlier.

The company kept a 20-billion-yen net profit estimate for the fiscal year to March on sales of 6.6 trillion yen, largely crediting the unchanged forecast "to the favourable impact of the depreciation of the yen".

But the outlook was "partially offset by downward revisions in annual unit sales forecasts of key products resulting from the stagnation of the electronics products market in all regions", Sony added.

Also Thursday, the company said it had swung to a nine-month operating profit of 82.96 billion yen, reversing a year earlier operating loss.

Sony has been undergoing a huge restructuring with the firm announcing last month it was selling its US headquarters in Manhattan for about $1.1 billion.

The plan includes thousands of layoffs, selling off its chemical division and investing 50 billion yen in camera and medical equipment maker Olympus.

The New York sale, expected to close in March, comes as the once-iconic company aims for a return to profitability after four years in the red.

In its last fiscal year, Sony lost a whopping 456.66 billion yen.

Japan's electronics sector has suffered myriad problems including the high yen, slowing demand in key export markets, fierce overseas competition especially in television sales and strategic mistakes that left its finances in ruins.

It has also been hurt by a Chinese consumer boycott of Japanese brands stemming from a territorial spat between Beijing and Tokyo.

The industry has been awash in huge losses and credit rating downgrades, with Sharp saying last year it would put up real estate as collateral for bank loans—including its Osaka headquarters—to stay afloat.

Last week, Panasonic and Sharp racked up more than $11 billion in combined losses over the nine months to December, and warned of more bleeding to come.

But the struggling pair both said they were on track for better times, with Sharp insisting its restructuring would keep it from going under and said it booked a small operating profit in the third quarter to December.

Last year, Sony's hard times saw its stock value tumble below 1,000 yen a share for the first time since the era of the Walkman. The shares have since come back, closing 2.56 percent higher at 1,519 yen on Thursday in Tokyo.

(c) 2013 AFP